OverseasInvestment: With the flow of Irish money into UK property investments increasing by the month, Bannon Commercial has just paid £8.5 million (€12.5 million) for two retail properties at 139 and 141 at Kensington High Street. Bought for an Irish investor, the deal will provide an initial yield of just over 4.5 per cent which should rise to 5 per cent.
The buildings are located within the Royal Borough of Kensington and Chelsea, widely regarded as one of London's most affluent residential and retail areas.
Kensington High Street is recognised as one of the best retail locations in the West End.
Number 139 Kensington High Street is let to Phones 4U for 20 years from 1996 at a rent of £254,000 (€369,000) per annum subject to five yearly upwards-only rent reviews. The other building is let to Aldo UK Ltd for 15 years from 2000 at a rent of £156,000 (€227,000) which is set to increase once the outstanding rent review is settled.
Bannon Commercial says that a number of UK institutions are rebalancing their central London portfolios as concerns mount about the likely effect on central locations of a new retail destination called The White City located outside Shepherd's Bush.
Bannon Commercial says that after consultation with local agents and retailers, it appeared that well located retail outlets will be relatively unaffected by the proposed scheme.
